InfoSpace Reports First Quarter 2001 Financial Results
InfoSpace reports first quarter revenues of $46.6 million; Registered wireless subscribers grow to more than two million; Transactions processed increase to more than $500 million in the first quarter
BELLEVUE, Wash., April 25 /PRNewswire/ -- InfoSpace, Inc. (Nasdaq: INSP - news), a leading global provider of merchant and consumer infrastructure services on wireless, broadband, and narrowband platforms, today announced that first quarter revenues were $46.6 million. InfoSpace reported a pro forma net loss of $5.5 million, or ($0.02) per share, exceeding the Company's guidance for the quarter by $0.02 per share.
(Photo: newscom.com )
Key financial and operating metrics:
InfoSpace ended the first quarter with more than two million registered wireless subscribers.
Wireless revenues increased to approximately 20 percent of total revenues.
More than $500 million was processed through InfoSpace's commerce products resulting in more than 50 percent of total merchant revenues.
Balance sheet remains strong and healthy with cash, cash equivalents and investments of more than $450 million and no debt.
``With the rapid adoption of our wireless services, new customer wins and significant growth in the amount of transactions processed, InfoSpace continues to demonstrate its strength and ability to generate new business and pursue favorable market opportunities,'' said Naveen Jain, chairman and CEO, InfoSpace, Inc. ``With the expected roll out of next generation networks this year and the launch of innovative new applications, there are many exciting and positive things happening for InfoSpace that we believe will provide catalysts for new growth in the future.''
Wireless
InfoSpace's wireless business continues to gain traction as more than two million wireless subscribers have registered for services powered by InfoSpace's platform and applications demonstrating the strong demand for wireless data services across leading wireless carriers including Verizon, Cingular and AT&T Wireless.
Wireless represented approximately 20 percent of total revenues for the first quarter fueled by new subscriber growth, customer wins, and upselling new features and functionality to current partners.
InfoSpace continues to expand its footprint internationally by signing new agreements and extending current ones with partners outside of the U.S. During the quarter, InfoSpace announced the launch of its platform with Brazil's Algar Telecom Leste (ATL). In less than two years, ATL has captured nearly 40 percent of the wireless services market in the states of Rio de Janeiro and Espirito Santo.
InfoSpace also demonstrated its commitment to distributing its Spanish-language platform throughout Central and South America, the Caribbean and among Spanish speakers in the U.S. During the quarter, InfoSpace announced that Cingular Wireless was the first company to adopt this new platform.
During the past 12 months, wireless carriers worldwide have been investing in and preparing for the roll out of next generation networks. InfoSpace has been working to develop the applications and services wireless carriers need to quickly monetize their large investments in new infrastructure technologies. Some of these services, including mobile commerce and games, were demonstrated with Nortel and Lucent at CTIA in March.
With the faster connections and increased functionality of next generation networks, InfoSpace will enable its wireless carrier partners to offer additional services to their subscribers that leverage those benefits. For example, faster connections offered by 2.5G and 3G networks will enable the delivery of more robust and graphic-intensive sources of information as well as more intuitive user interfaces that make it easier than ever for subscribers to shop online, find local merchants, receive promotions and discounts, find local merchants, play games, communicate with others, receive up-to-the-minute information and access driving directions real-time.
In addition, the always-on feature of advanced networks that maintains a constant connection to the Internet will enable InfoSpace's instant messaging application let a user know whether or not their buddy-list members have their cell phones turned on and are available to receive messages, provide subscribers with instant notification of new e-mail, and to offer access to real-time information at a glance.
InfoSpace looks forward to the roll out of next generation networks and launching new applications, such as games and multimedia, to help wireless carries plan their long-term product roadmap and functionality as network capacity grows.
Merchant
InfoSpace's merchant business continues to report solid growth. For the first quarter, approximately 20 percent of total revenues came from the merchant business. Coming off a seasonally high fourth quarter, InfoSpace processed more than $500 million in the first quarter. Transaction revenue represented approximately 50 percent of total merchant revenues.
Momentum continues for InfoSpace's payment processing platform, Authorize.Net, as it was announced that more than 100,000 merchants are now signed up for the service making it a leader in the payment processing market. InfoSpace also announced the launch of mobile payment processing, helping to turn mobile devices into point-of-sale devices by enabling credit cards to be authorized, charged or credited without using a traditional card swipe terminal or PC with a fixed line connection. Merchants will have the freedom and flexibility to instantly process transactions on the spot with a handheld device, particularly useful for sales forces, taxis and other mobile vendors.
Broadband
InfoSpace continues to make inroads in establishing its footprint in the emerging broadband and interactive TV (iTV) market. During the quarter, the Company forged an array of building block relationships with partners to support emerging platforms and protocols to help InfoSpace build the most compelling solution to take advantage of this opportunity.
During the first quarter, InfoSpace announced partnerships with major broadband/iTV providers such as Microsoft TV, Liberate, OpenTV and ICTV. InfoSpace also announced it is working to build its first iTV application for Bloomberg Television.
InfoSpace will develop and deliver a customized iTV application that enhances the Bloomberg Television viewing experience through interactive access to a personalized stock portfolio, news and other compelling functions.
2001 is a strategic year for the development and growth of InfoSpace's broadband services as the Company continues to pursue new opportunities to help build its foundation to take advantage of this opportunity.
Note: InfoSpace has scheduled a conference call for 2 p.m. PDT to discuss first quarter 2001 financial results. Interested parties may access the conference call over the Internet through the Company's Web site at www.infospace.com in the Investor Relations section.
A replay will be available approximately one hour after the call until Wednesday, May 2 at 6 p.m. PST on the website or by dialing 888-203-1112 using the passcode 638997.
CONTACT: Joni Hanson, Senior Vice President of Investor Relations and Communications, 425-201-6100, or jhanson@infospace.com; or Nicole Knowles, Investor Relations Director, 425-201-6100, or nicole.knowles@infospace.com, or media, Steve Stratz, Public Relations Manager, 425-709-8617, steve.stratz@infospace.com, all of InfoSpace, Inc.
About InfoSpace, Inc.
InfoSpace is a leading global provider of merchant and consumer infrastructure services on wireless, broadband, and narrowband platforms. The Company provides commerce, information, and communication infrastructure services to wireless devices, merchants, and Web sites. InfoSpace's partners encompass a global network of wireless, PC, and non-PC devices, including cellular phones, pagers, screen telephones, television set-top boxes, online kiosks and personal digital assistants. InfoSpace has relationships with Verizon Wireless, AT&T Wireless, Cingular Wireless, Intel, Virgin Mobile, Hasbro, National Discount Brokers, and Bloomberg, among others. InfoSpace's affiliate network also consists of more than 3,200 Web sites that include AOL, Microsoft, NBCi, Lycos, and ABC LocalNet. InfoSpace is also positioned to tap the market for broadband wired (DSL and cable) and broadband wireless (2.5G and 3G) services, such as interactive gaming, television and other entertainment services. In addition, the Company recently added back-end payment processing to InfoSpace's existing commerce services, allowing InfoSpace to offer everything a merchant needs to conduct the entire lifecycle of a transaction, one of the key drivers of mobile commerce adoption.
This release contains forward-looking statements relating to the development of the company's products and services and future operating results that are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. The words ``believe,'' ``expect,'' ``intend,'' ``anticipate,'' variations of such words, and similar expressions identify forward-looking statements, but their absence does not mean that the statement is not forward-looking. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Factors that could affect the Company's actual results include the progress and costs of the development of our products and services, the timing of market acceptance of those products and services, the performance of our systems, the effectiveness of the development and implementation of our strategy, the ability to retain key personnel, and general economic conditions. A more detailed description of certain factors that could affect actual results include, but are not limited to, those discussed in InfoSpace's Annual Report on Form 10-K, in the section entitled ``Factors Affecting InfoSpace's Operating Results, Business Prospects and Market Price of Stock.'' Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. InfoSpace undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.
InfoSpace, Inc.
Pro Forma Consolidated Statements of Operations (A)
(unaudited)
(in 000's, except per share data)
Three months ended March 31,
2001 2000
Revenues $46,565 $38,778
Cost of revenues 11,720 6,088
Gross profit 34,845 32,690
Operating expenses:
Product development 11,784 6,032
Sales, general and administrative 34,437 19,363
Total operating expenses 46,221 25,395
Income (loss) from operations (11,376) 7,295
Other income, net 5,958 7,584
Income tax expense (50) (18)
Pro forma income (loss) $(5,468) $14,861
Pro forma basic earnings (loss) per
share $(0.02) $0.05
Pro forma diluted earnings (loss) per
share $(0.02) $0.04
Shares used in computing pro forma
basic earnings (loss) per share 323,136 289,461
Shares used in computing pro forma
diluted earnings (loss) per share 323,136 334,237
(A) Pro forma results exclude non-cash charges, non-recurring charges
and items unrelated to the Company's core operations. This financial
statement excludes amortization of intangibles, acquisition-related
expenses, restructuring and other non-recurring charges, losses on
investments and cumulative effect of change in accounting principle,
which are summarized in the following table. This financial statement
also excludes employer payroll taxes assessed on stock option gains
realized by employees from non-qualified stock option exercises which are
recorded in cost of revenue, product development and sales, general and
administrative expenses. They do not purport to be financial statements
prepared in accordance with accounting principles generally accepted in
the United States (GAAP). The following table reconciles the pro forma
net income (loss) in accordance with GAAP for the periods presented.
InfoSpace, Inc.
Reconciliation of Pro Forma Net Income (Loss)
(unaudited)
(in 000's, except per share data)
Three months ended March 31,
2001 2000
Pro forma net income (loss) $(5,468) $14,861
Employer payroll taxes on stock
option exercises (284) (4,585)
Amortization of intangibles (61,402) (28,010)
Acquisition & other related charges (889) (86,397)
Restructuring charges (1,462) --
Other non-recurring charges (842) (2,888)
Gain (loss) on investments in
Venture Capital Fund, net of
minority interest (19,401) 13,755
Loss and impairment on investments (28,190) --
Cumulative effect of change in
accounting principle (3,171) (2,055)
Net loss $(121,109) $(95,319)
InfoSpace, Inc.
Consolidated Statements of Operations
(unaudited)
(in 000's, except per share data)
Three months ended March 31,
2001 2000
Revenues $46,565 $38,778
Cost of revenues 11,721 6,134
Gross Profit 34,844 32,644
Operating expenses:
Product development 11,787 6,951
Sales, general and administrative 34,717 22,983
Amortization of intangibles 61,402 28,010
Acquisition & other related charges 889 86,397
Other non-recurring charges 842 2,888
Restructuring charges 1,462 --
Total operating expenses 111,099 147,229
Loss from operations (76,255) (114,585)
Gain (loss) on investments in
Venture Capital Fund, net of
minority interest (19,401) 13,755
Loss and impairment on investments (28,190) --
Other income, net 5,958 7,584
Loss before income tax expense and
cumulative effect of change in
accounting principle (117,888) (93,246)
Income tax expense 50 18
Loss before cumulative effect of
change in accounting principle (117,938) (93,264)
Cumulative effect of change in
accounting principle (3,171) (2,055)
Net loss $(121,109) $(95,319)
Basic loss per share $(0.37) $(0.33)
Shares used in computing basic net
loss per share 323,136 289,461
Condensed Consolidated Balance Sheets
(in 000's)
March 31, December 31,
2001 2000
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $180,363 $153,913
Short-term investments 101,797 216,235
Accounts receivable, net 23,253 33,881
Payroll tax receivable 13,214 620
Notes and other receivables, net 22,506 21,701
Prepaid expenses and other current assets 8,987 14,491
Total current assets 350,120 440,841
Property and equipment, net 54,118 51,137
Long-term investments 82,322 32,451
Other investments 84,967 121,574
Intangibles, net 697,791 621,032
Other long-term assets 4,007 5,075
Total assets $1,273,325 $1,272,110
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $4,756 $4,537
Accrued expenses and other current
liabilities 40,533 37,999
Deferred revenue 26,161 31,430
Total current liabilities 71,450 73,966
Long-term liabilities and minority interest:
Long-term deferred revenue 5,026 7,974
Minority interest -- 21,599
Total liabilities 76,476 103,539
Stockholders' equity:
Common stock 32 31
Additional paid-in capital 1,737,348 1,596,214
Accumulated deficit (529,756) (408,647)
Deferred expense - warrants (1,292) (1,495)
Accumulated other comprehensive loss (6,197) (16,032)
Unearned compensation - stock options (3,286) (1,500)
Total stockholders' equity 1,196,849 1,168,571
Total liabilities and stockholders'
equity $1,273,325 $1,272,110
MAKE YOUR OPINION COUNT - Click Here
tbutton.prnewswire.com
SOURCE: InfoSpace, Inc. |
